Exhibit 10.18
NATIONAL BEEF PACKING COMPANY,
LLC
MANAGEMENT INCENTIVE
PROGRAM
1.
Purpose
. The National Beef Packing Company, LLC
Management Incentive Program (the “Plan”) has been
established to provide additional incentive compensation
opportunities for certain personnel employed by National Beef
Packing Company, LLC (the “Company”). The main
purpose of the Plan is to provide an incentive to eligible
employees to influence and increase the profitability of the
Company. The Plan is hereby restated as of August 26,
2007, to reflect a change in the calculation of the Bonus
Pool.
2.
Administration
. The Plan is administered by the Board of
Managers of the Company (the “Board”), which has
complete discretion and authority with respect to the Plan and its
application, except to the extent that discretion is expressly
limited by the Plan.
3.
Definitions
. For purposes of this Plan,
the following terms shall have the meanings set forth
below:
a. Affiliate shall mean HyPlains Beef, L.C., HyPlains Dressed
Beef, Farmland Industries, Inc. (but not with respect to any
employee hired from Farmland Industries, Inc. on or after
August 6, 2003), National Carriers, Inc. or any
subsequently acquired affiliate of the Company. For this
purpose, an “acquired affiliate” shall be any entity in
which the Company owns 50% or more of the stock or
assets.
b. Applicable Vesting Percentage
shall mean the percentage used for
purposes of calculating Eligible Earnings, based on the following
schedule:
|
|
Employment Period
|
|
Applicable Vesting
Percentage
|
|
|
|
First 12 months
|
|
50
|
%
|
|
|
Second 12 months
|
|
75
|
%
|
|
|
Thereafter
|
|
100
|
%
|
d. Board shall mean the Board of Managers of the
Company.
e. Bonus shall mean the benefits paid to Eligible
Employees under this Plan.
f.
Bonus Pool
shall mean an amount calculated
based on the following: Pre-bonus Net Income multiplied by
14%.
g. Company shall mean National Beef Packing Company,
LLC.
h. Eligible Earnings shall mean:
(1)
In the case of an Eligible Employee
who is classified as management personnel, the Eligible
Employee’s gross earnings for the applicable fiscal year in a
management position, multiplied by the Applicable Vesting
Percentage.
(2)
In the case of an Eligible Employee
who is classified as professional personnel, the Eligible
Employee’s gross earnings for the applicable fiscal year in a
professional position, multiplied by the Applicable Vesting
Percentage, and further multiplied by 25%.
Notwithstanding the above, Eligible
Earnings shall in no event include any Bonuses or other
compensation outside the scope of ordinary salary paid during the
applicable fiscal year.
i.
Eligible Employee
shall have the meaning set forth in
Section 4.
j.
Excluded Companies
shall mean Kansas City Steak
Company and National Carriers, Inc.
k. Plan shall mean this National Beef Packing Company,
LLC Management Incentive Program.
l.
Pre-bonus Net Income
shall mean the Net Income of the
Company less the Net Income of the Excluded Companies plus the
total bonus accrued for the Company (not including bonus accrued
for the Excluded Companies) plus 20% of the net income of the
Excluded Companies.
m. Target shall mean that the Company has attained, for
the applicable fiscal year, after provision for bonus expense under
this plan and all other incentive plans of the Company, an after
tax profit of at least $20 million. If the Company does not
attain, for the applicable fiscal year, an after tax profit of at
least $20 million, the Target will be deemed to have not been
reached and no Bonuses will be paid out under this Plan for such
year.
4.
Eligibility for
Participation . For purposes of this Plan, the term
“Eligible Employee” shall include all management and
professional (salaried) personnel and all management support
(hourly wage employees who are not exempt from overtime pay)
personnel employed by the Company who:
a.
